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Any economist will tell you that markets are cyclical. Things go up, things go down. The tide comes in, the tide goes out. I could go on with the analogies, but you get the drift. This is about real estate though. And real estate is no different than any other market. A couple of years ago we saw the real estate market go way up. The tide really came in. Well now we have seen the market really come down. Yes, the tide is out.

But is it really all doom and gloom? Did the sky really fall in? I’m not going to sit here and deny that we had a mortgage crisis. It was indeed a veritable mortgage industry meltdown that has sent shockwaves through the entire economy. But relax people: this is just a cycle.

And the current signs are that we may be at the bottom of this bell shaped curve (that’s algebra 101). Home prices are still falling. Foreclosures are still on the rise. But here is the good news: Existing home sales are on the rise! They doubled in many areas over the last quarter. This is a huge economic indicator folks. Does this mean that the worst is over? I think it does!

Today’s real estate market is a very tough one. And it is not just people who are trying to buy or sell a house that are suffering from this depressed market either. Those who make their living in the real estate industry are suffering too. The Realtors are starving! Quite a few of my colleagues have been either forced to take on extra jobs or have been completely forced out of the business.

That is why as a Realtor you need to take advantage of and make the most of any marketing opportunities that arise. This is particularly true when those marketing opportunities are free. And this is where social networking comes in. The big three social networking sites that Realtors can exploit in my opinion are Facebook, Twitter and MySpace.

Now before you shake your head and say “I’m too old to be on MySpace” maybe you should check to see if your competition already is. You can post your opinions as advice on these web sites. You can even place links to your own website in these blog type posts (links to your website is what determines the popularity of your web site in the eyes of search engines. And doing this is all quick, easy and best of all free.

It probably will not come as a shock to you to hear that we are in the middle of a declining real estate market. Prices of homes are going down across the board. And it is not just a regional thing either. This is a problem occurring nation wide.

One of the main causes of this declining market falls on the simple laws of supply and demand. We have a huge supply of homes for sale. We don’t have a whole lot of people buying homes right now though. Why is this? It is primarily due to the over zealous way lenders were giving away money several years ago. Now that consumers’ rates are changing people can no longer afford their houses. Combine that with the declining job market and the fact that many people who thought they had stable careers are now out of work and you can see why people can no longer afford their monthly mortgage payments.

So the houses go into foreclosure. The bank is then stuck with a house that they loaned more money on then what it is now worth. The bank is now upside down or in a position of negative equity. And the downward spiral continues. It has been a rough ride, but many economists are suggesting that we are near the bottom of this cycle. For all of us that still own homes, let’s hope that these economists are correct!

It is a buyer’s market. And I am a Realtor with an FHA qualified buyer who is looking to buy a piece of Chandler real estate. You would think that I would have a pretty easy job considering the number of houses on the market right now wouldn’t you? Well it is not as easy as you might think!

First of all, the majority of these homes are in a short sale situation. This means that the banks own them and they are selling the homes in an “as is” condition. Almost all of these homes have at least one issue that will prevent FHA approval without being repaired. The banks also usually refuse to turn on the utilities during the escrow period. FHA won’t get through underwriting if that is the case.

Then there are the homes that were bought by investors on the court house steps after a foreclosure. They are trying to turn around and sell these homes at a great price. But unless the owner has owned the home for 90 days or more, FHA will not allow it to be purchased! They consider the home not to be seasoned. So even though I have a preapproved buyer and there are a ton of homes on the market, there really are not very many to choose from.

The main focus of the new economic stimulus plan should be reviving the real estate market. This is the main point that our new president should be looking at and addressing. This whole economic disaster is the result of problems in the housing market. Yet for some reason, the current economic stimulus bill that is set to go to the president does not include the needed provisions to help stabilize these real estate markets.

While both the House and Senate versions include things that realtors have been advocating through mass emailing campaigns, more changes are still needed. Specifically, the National Association of Realtors says that we need “increased resources for foreclosure mitigation to stem the flood of foreclosures.” Foreclosures are running rampant right now, and with that come a flood of bank owned short sales. These short sales devalue the surrounding properties, and the problem snowballs.

Yet these politicians seem to be more concerned with pork barrel projects that would help their constituencies instead of helping the nation. This is where you come in! If you are a registered voter, send an email to your congressperson and your senator asking him or her to look out for your best interest. Ask them to make sure that the economic stimulus package helps the ailing and failing real estate market.

Even though home prices have tanked and are still sliding downward, we’re starting to see signs that home values may be rebounding from their historic lows. Although the article cites a drop in home sales, it also cites a slight shrinking in the inventories of unsold homes, which could be the indicator in a slackening in the slide in home values that we’ve been seeing for the last six months.

But, if home values are rebounding at all, that means that it might be time to start perusing the real estate listings for bargains that can be snapped up as either rental properties or investment properties. Despite the problems in U.S. real estate markets, real estate will always hold at least some of its value because no matter what, people will always need somewhere to live. Just as people will always need utilities, food, water, clothing and medical care, people will always need a roof over their heads. What makes real estate hold its value is that it is a finite commodity. After all the livable land is used up, there’s really no practical way to make more.

Although the news in the world of real estate has been uniformly bleak for the last half of 2008, there may be a glimmer of good news when it comes to real estate listings. This morning I heard on the news on NPR that the U.S. inventory of unsold homes has been steadily shrinking for the last five months. What does that mean to the housing industry? Well, once the inventory of unsold homes is exhausted, there will be more demand for new homes and the chance for the sale of new homes to start growing again. It’s crucial for Americans to begin buying new housing because the housing industry is one of the primary engines that grows the U.S. economy. More homes being sold means that companies like Home Depot will be selling more building supplies, which means jobs for Americans.

A rise in housing sales also means more jobs for carpenters, framers, plumbers, electricians, laborers, salesmen, and the management of housing construction companies. A rise in home sales will simply be good for America, which is one of the main reasons that economists and politicians watch the rise and fall of real estate listings so closely now. So let’s all keep our fingers crossed that America’s housing market begins to bounce back sooner rather than later. For more information on this hopeful phenomenon, check out this article I found in The Wall Street Journal: http://online.wsj.com/article/SB122226123307770911.html.

Real Estate Advisor inquired:


Eager to know the top cites in America where one can safely invest? Here are the best real estate markets in the entire country according to a recent report from Business 2.0 Magazine. The November 2006 edition of the magazine lists the top ten cities that are ideal to buy a home. These are – Panama City and Vero Beach in Florida, Bridgeport in Connecticut, Lakeland in Florida, McAllen in Texas, San Luis Obispo in California, Wilmington in North Carolina, Manchester in New Hampshire, Fort Collins in Colorado and Atlanta in Georgia. The report cites the appreciation rates of home prices projected over a period of five years.

Florida enjoys the status of having three of the top four cities to invest in. Panama City, which tops the list of best places to buy real estate is expected to have a real estate appreciation of 72% over the next five years. Major real estate development projects such as the building of a new airport and low property prices are expected to boost the economy and the housing market.

Vero Beach, projected to have an appreciation of 64%, comes second for its excellent weather, low property taxes and a lower cost of living. Lakeland, with a 59% projected gain in home prices is a tempting option with homes selling for a fifth less than the national median price.

Buying a home in Bridgeport, CT is a bargain now with median home prices at a very low $280,000 compared to the rest of the Fairfield County. Home prices in McAllen, TX which holds the fifth place, are expected to soar by 57%.

It is estimated that homes in the McAllen, TX area may appreciate 57 percent with an increase in the median home price from $70,000 to $109,000.

Homeowners making an investment in San Luis Obispo, California, today, are expected to get a good appreciation (40%) on their homes over the next five years.

The median home price in Wilmington, NC is expected to increase to $297,000 by 2011, up from the current price of $217,000, an increase by 37%.

Manchester, NH, which has twice been rated as the ‘best place to live’ in America by Money Magazine, sits at eighth place with an expected appreciation of 35%.

Fort Collins and Atlanta follow in the ninth and tenth places of top cities for real estate investment in the USA. Fort Collins, one of the most popular cities in America, has been ranked as the ‘No.1 small city’ this year by Money Magazine. Recent price reductions in the housing market makes ‘now’ the best time to buy a home or condo in this city with an estimated property appreciation of 28%. Atlanta is poised for a significant appreciation too with an expected rise of up to 24% in home prices over the next five years.

So, if you are a prospective homebuyer set to take a plunge into any of the top ten real estate markets, it is the right time to enlist the services of a good real estate agent who can guide you through the complicated home buying process.

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